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UPJOHN CO. v. GENERAL ACCIDENT INS. CO. OF AMERICA

February 23, 1984

The UPJOHN COMPANY, Plaintiff,
v.
GENERAL ACCIDENT INSURANCE COMPANY OF AMERICA, et al., Defendants



The opinion of the court was delivered by: PARKER

 BARRINGTON D. PARKER, District Judge.

 On September 10, 1982, this Court entered an order transferring this proceeding to the District of Connecticut in "the interest of justice" pursuant to 28 U.S.C. § 1404(a). In entering that order the Court ruled on basis of the memoranda submitted by the parties and did not hold a hearing. The order did not explain fully the reasons for the decision to transfer. Immediately thereafter, plaintiff Upjohn Company filed a petition for a writ of mandamus in our Court of Appeals seeking to vacate the transfer order.

 This Court has reviewed the record and considered oral argument and representations of counsel and submits the following statement of reasons and findings in support of the September 10, 1982 order of transfer to the District of Connecticut.

 On February 26, 1982, Aetna Casualty & Surety Company ("Aetna") filed an action against Upjohn and eight policy holders (all drug manufacturers) in the District of Connecticut. Aetna sought a declaration of rights and responsibilities under contracts of primary liability insurance issued by Aetna to Upjohn and the other defendants with specific reference to claims arising out of injuries allegedly caused by the synthetic estrogen product Diethylstilbestrol ("DES"). Seven insurance carriers including The London Defendants have been also involved as third party defendants.

 Shortly thereafter, on April 13, 1982, Upjohn filed the proceeding in this Court seeking declaratory relief against its primary liability insurers, General Accident Insurance Company of America ("General Accident") Aetna and numerous underwriters operating out of London as excess liability insurers (The London Defendants). Upjohn sought a declaration with respect to the same issues, and many of the same policies, which were before the Connecticut District Court.

 The issues of law and fact in the District of Connecticut proceeding and in this proceeding are substantially similar. The central legal issue is the same, namely, what event triggers coverage for DES injury claims under the policies at issue in these cases. Both actions require the court to determine when the "injuries" allegedly caused by DES "occurred" within the meaning of the policy.

 When Upjohn filed the proceeding in this Court, Aetna then moved on April 29, 1982, in the District of Connecticut to enjoin Upjohn from continuing to prosecute the District of Columbia action. On June 7, 1982, arguments were heard on Aetna's motion by Judge Jose A. Cabranes. Upjohn argued that the District of Columbia was a preferable forum because it needed "relief with respect to our other primary carrier, General Accident, and we need relief with respect to our significant excess carriers. We have sued all of them in Washington." Transcript of Hearing, p. 42 (attached as Exhibit C to the London Defendants' Reply to the Plaintiff's Opposition to Transfer). Upjohn's counsel expressed concern that the two District Courts could reach inconsistent results. "Indeed, we could get a result up here as to the year 1959 that would bind Aetna and would not bind the excesses right behind Aetna for the very same year." Transcript, p. 43. Finally, counsel stated "we want a decision as soon as possible, and we want a decision that binds all our carriers at once." Transcript p. 45. Judge Cabranes challenged Upjohn to explain why the issues raised in this action could not be joined in the first filed action in Connecticut and expressed his willingness to have the entire coverage dispute determined in Connecticut, commenting that "I haven't heard yet that there is any insurmountable obstacle to bringing all of those parties or issues before the court, if you care to do so." Transcript, p. 46.

 On July 16, 1982, the London defendants moved in this proceeding to transfer this action to the District of Connecticut pursuant to 28 U.S.C. § 1404(a). The reason asserted was that transfer would avoid unnecessary duplication of judicial resources and insure a consistent, comprehensive resolution to the Upjohn coverage dispute. They have not argued that the "convenience of the parties and witnesses" would be served significantly by transfer.

 On August 19, 1982, Judge Cabranes enjoined Upjohn from pursuing the action in this Court as against Aetna.

 In ruling on Aetna's motion, Judge Cabranes rejected Upjohn's arguments that (1) Upjohn's choice of forum is controlling, (2) litigation in the District of Columbia can be completed more efficiently and (3) the District of Columbia is a more convenient forum. Transcript of Opinion, pp. 50-56 (attached as Exhibit B to the London Defendants' Reply to Plaintiff's Opposition to Transfer).

 Upjohn ceased the prosecution of its claims against Aetna in this Court following Judge Cabranes' ruling. Thus the District of Connecticut is at present the forum in which a consistent, comprehensive resolution of the Upjohn insurance coverage dispute can be achieved as to both primary and excess policies.

 There is no meaningful connection, for purposes of transfer pursuant to Section 1404(a), between the parties to this action and the District of Columbia. None of the parties has its principal place of business here. There is no evidence that the insurance contracts at ...


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